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January 27, 2025 Investor Insights Thumbnail

January 27, 2025 Investor Insights

Less Discretionary Spending

January 27, 2025

Enjoy this week's "Investor Insights," a weekly newsletter that highlights the financial news you need and provides tips and tricks for making better investment decisions. 

  • Sales of previously owned homes hit the lowest level since 1995 for the second year in a row, down a third from 2021. The median price in December was $404,400, up 6% from December 2023 but down from the June peak of $426,900. 1
  • The U.S. now has 48 tech firms earning over $1 billion each, while the rest of the entire world only has 35. This is one reason why the U.S. equity and bond markets total $79 trillion, 8 times larger than the next biggest market. 2
  • In 2024, 60% of the $6.75 trillion federal budget went to Medicare, Medicaid, and Social Security. Interest on the national debt and defense spending together represented another 26%. That left only around 13% for discretionary nondefense spending. 3
  • Megacap tech firms drove most of the S&P 500's 70% rise over the past two years. However, profits for the top seven tech firms (Mag 7) are expected to grow at just 22% in the most recent quarter (down from 51% in Q1) and have the smallest increase since early 2023. *4

Sources:

  1. WSJ - "U.S. Homes Sales in 2024 Fell to Lowest Level in Nearly 30 Years"
  2. The Irrelevant Investor - "USA, Inc. Our Markets Are the Envy of the World"
  3. Barrons - "High Interest Rates Are Hammering Investors. What Lies Ahead Could Be Worse."
  4. Bloomberg - "Tech’s $15 Trillion Rally Hinges on High-Stakes Earnings Stretch"

*Past performance is not indicative of future performance

Disclosure: This information is furnished for the use of Glen Eagle Advisors, LLC, Glen Eagle Wealth, LLC, and their clients and/or contacts. It does not constitute the provision of investment advice to any person. It is not prepared with respect to the specific objectives, financial situation, or particular needs of any specific person. Investors reading this commentary should consult with their Glen Eagle representative/financial advisor regarding the appropriateness of investing in any securities or adapting any investment strategies discussed or recommended in this newsletter. 

Glen Eagle Wealth, LLC is a member of FINRA, MSRB and SIPC 

Glen Eagle Advisors, LLC is a SEC Registered Investment Advisor 

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